View:
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) MAY 5, 2006
PIZZA INN, INC.
(Exact name of registrant as specified in its charter)
MISSOURI 0-12919 47-0654575
(State or other jurisdiction of incorporation) (Commission File Number) (IRS
Employer Identification No.)
3551 PLANO PARKWAY, THE COLONY, TEXAS 75056
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (469) 384-5000
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ]Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 7.01 REGULATION FD DISCLOSURE.
Pizza Inn, Inc. elects to disclose the information in the press release
furnished as Exhibit 99.1 to this report and incorporated herein by reference
through Form 8-K pursuant to Regulation FD.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(C) EXHIBITS.
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------- ----------------------
99.1 Press Release dated May 5, 2006 (furnished herewith and incorporated
- ---- -----------------------------------------------------------------------
herein by reference)
- ----------------------
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Pizza Inn, Inc.
Date: May 8, 2006 By: /s/ Rod J. McDonald
Rod J. McDonald, Secretary
PIZZA INN, INC. REPORTS RESULTS FOR THE
THIRD QUARTER FISCAL YEAR 2006
THE COLONY, TEXAS - TBD, 2006 - PIZZA INN, INC. (NASDAQ:PZZI) today reported a
net loss per share for its third quarter ended March 26, 2006 of ($0.05) versus
earnings of $0.00 per share for the same quarter last year. The quarter
resulted in a net loss of ($477,000) versus a net loss of ($20,000) for the same
quarter last year on revenues of $12.8 million and $13.4 million, respectively.
THIRD QUARTER FY 2006 VERSUS THIRD QUARTER FY 2005 RESULTS
- -------------------------------------------------------------------
Diluted EPS was ($0.05) versus $0.00 on a net loss of ($477,000) versus a
net loss of ($20,000) for the same quarter last year.
Same store buffet restaurant sales increased 1.1% for the quarter and same
store chainwide retail sales increased 0.4% for the quarter.
- - Total revenues decreased approximately 4%, or $589,000, primarily due to
2.6% overall lower chainwide retail sales as a result of fewer net stores and
lower cheese prices. The resulting reductions in food and supply sales and
royalty revenues were partially offset by higher company-owned restaurant sales
due to the opening of three new company buffet restaurants in the current fiscal
year.
- - Losses for company-owned restaurants increased approximately $140,000 to
($238,000).
- - Salaries increased approximately $134,000 due to increased staffing levels
and severance payments made.
- - Energy costs increased approximately $114,000.
General and administrative expenses included non-cash stock compensation
expense of $88,000 for approximately 560,000 stock option rights granted
previously. The prior year did not include any non-cash compensation expense.
P R E S S R E L E A S E
FOR IMMEDIATE RELEASE
PIZZA INN, INC. REPORTS RESULTS FOR THE
THIRD QUARTER FISCAL YEAR 2006
(CONTINUED)
The Company's President and CEO, Tim Taft, commented, "Following months of
research and preparation, we implemented the first phase of our marketing plan
in January of this year and are already seeing encouraging results from these
efforts. In addition, the renewed trust and confidence our franchise partners
have in the brand's new direction is producing positive results. We continue to
work together to establish the proper direction for Pizza Inn, one focused on
our competitive strengths and advantages. Although sales performance is
improving at Pizza Inn, we have not lost sight of our opportunity to improve its
operating performance."
Certain statements in this press release, other than historical information, may
be considered forward-looking statements, within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995, and
are subject to various risks, uncertainties and assumptions. Should one or more
of these risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may differ from those anticipated, estimated or
expected. Among the key factors that may have a direct bearing on Pizza Inn's
operating results, performance or financial condition are its ability to
implement its growth strategies, national, regional and local economic
conditions affecting the restaurant/ entertainment industry, competition within
each of the restaurant and entertainment industries, store sales
cannibalization, success of its franchise operations, negative publicity,
fluctuations in quarterly results of operations, including seasonality,
government regulations, weather, commodity, insurance and labor costs.
Pizza Inn, Inc. is headquartered in The Colony, Texas, along with its
distribution division, Norco Restaurant Services Company. Pizza Inn franchises
approximately 378 restaurants and currently owns four restaurants with annual
chainwide sales of approximately $155 million.
PIZZA INN, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED
-------------------- -------------------
MARCH 26, MARCH 27, MARCH 26, MARCH 27,
REVENUES: 2006 2005 2006 2005
-------------------- ----------- ------------------- -----------
Food and supply sales $ 11,131 $ 11,859 $ 33,654 $ 36,981
Franchise revenue 1,200 1,319 3,579 3,884
Restaurant sales 512 223 1,069 721
-------------------- ----------- ------------------- -----------
12,843 13,401 38,302 41,586
-------------------- ----------- ------------------- -----------
COSTS AND EXPENSES:
Cost of sales 11,225 11,241 33,451 35,125
Franchise expenses 783 723 2,384 2,044
General and administrative expenses 1,363 1,311 4,461 3,497
-------------------- ----------- ------------------- -----------
13,371 13,275 40,296 40,666
-------------------- ----------- ------------------- -----------
OPERATING (LOSS) INCOME (528) 126 (1,994) 920
Gain on sale of asset 2 - 149 -
Interest expense (211) (157) (579) (431)
-------------------- ----------- ------------------- -----------
(LOSS) INCOME BEFORE
INCOME TAXES (737) (31) (2,424) 489
Provision for income taxes (260) (11) (856) 173
-------------------- ----------- ------------------- -----------
NET (LOSS) INCOME $ (477) $ (20) $ (1,568) $ 316
==================== =========== =================== ===========
BASIC (LOSS) EARNINGS
'PER COMMON SHARE $ (0.05) $ - $ (0.15) $ 0.03
==================== =========== =================== ===========
DILUTED (LOSS) EARNINGS
' PER COMMON SHARE $ (0.05) $ - $ (0.15) $ 0.03
==================== =========== =================== ===========
WEIGHTED AVERAGE
' COMMON SHARES 10,138 10,089 10,118 10,109
==================== =========== =================== ===========
WEIGHTED AVERAGE COMMON
AND POTENTIAL DILUTIVE
COMMON SHARES 10,188 10,117 10,164 10,142
==================== =========== =================== ===========
PIZZA INN, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(unaudited)
MARCH 26, JUNE 26,
2006 2005
--------------------- ---------------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 190 $ 173
Accounts receivable,
less allowance for doubtful
accounts of $209 and $360
respectively 2,894 3,419
Accounts receivable - related parties 465 622
Notes receivable, current
portion, less allowance
for doubtful accounts
of $0 and $11, respectively 63 -
Inventories 1,996 1,918
Property held for sale - 301
Deferred tax assets, net 1,011 193
Prepaid expenses and other 353 355
--------------------- ---------------------
Total current assets 6,972 6,981
LONG-TERM ASSETS
Property, plant and equipment, net 13,340 12,148
Property under capital leases, net - 12
Long-term receivable 10 -
Long-term receivable - related party 313 314
Goodwill 153 -
Reacquired development territory 479 623
Deposits and other 196 177
--------------------- ---------------------
$ 21,463 $ 20,255
==================== =====================
LIABILITIES AND
SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable - trade $ 2,558 $ 1,962
Accrued expenses 1,896 1,374
Current portion of long-term debt 8,648 406
Current portion of capital
lease obligations - 11
--------------------- ---------------------
Total current liabilities 13,102 3,753
LONG-TERM LIABILITIES
Long-term debt - 7,297
Long-term capital
lease obligations - 13
Deferred tax liability, net - 3
Other long-term liabilities 523 283
--------------------- ---------------------
13,625 11,349
--------------------- ---------------------
COMMITMENTS AND
CONTINGENCIES
SHAREHOLDERS' EQUITY
Common Stock, $.01 par value;
authorized 26,000,000
shares; issued 15,090,319 and
15,046,319 shares, respectively;
outstanding 10,138,494 and
10,094,494 shares, respectively 151 150
Additional paid-in capital 8,371 8,005
Retained earnings 19,014 20,582
Accumulated other comprehensive loss (54) (187)
Treasury stock at cost
Shares in treasury: 4,951,825
and 4,951,825, respectively (19,644) (19,644)
--------------------- ---------------------
Total shareholders' equity 7,838 8,906
--------------------- ---------------------
$ 21,463 $ 20,255
===================== =====================
PIZZA INN, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
NINE MONTHS ENDED
-----------------
MARCH 26, MARCH 27,
2006 2005
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income $ (1,568) $316
Adjustments to reconcile net (loss) income to
cash provided by operating activities:
Depreciation and amortization 884 861
Gain on property held for sale (159) -
Provision for bad debt 100 30
Utilization of deferred taxes - (20)
Stock compensation expense 285 -
Deferred rent 32 -
Changes in assets and liabilities:
Notes and accounts receivable 491 (358)
Inventories (79) (435)
Accounts payable - trade 596 786
Accrued expenses (166) (711)
Prepaid expenses and other 158 51
----------- -------
CASH PROVIDED BY OPERATING ACTIVITIES 574 520
----------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of assets 589 -
Capital expenditures (2,165) (721)
----------- -------
CASH USED FOR INVESTING ACTIVITIES (1,576) (721)
----------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of long-term bank debt and capital lease
obligations (110) (102)
Borrowings of bank debt 1,047 -
Stock repurchase - (160)
Proceeds from exercise of stock options 82 16
----------- -------
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES 1,019 (246)
----------- -------
Net increase (decrease) in cash and cash equivalents 17 (447)
Cash and cash equivalents, beginning of period 173 617
----------- -------
Cash and cash equivalents, end of period $ 190 $ 170
----------- -------